LEGISLATIVE BUDGET BOARD
Austin, Texas
 
FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION
 
April 5, 2009

TO:
Honorable Rene Oliveira, Chair, House Committee on Ways & Means
 
FROM:
John S. O'Brien, Director, Legislative Budget Board
 
IN RE:
HB4063 by Gonzalez Toureilles (Relating to the periods for applying for and receiving designation of a well as a two-year inactive well for purposes of the oil and gas severance tax exemption.), As Introduced



Estimated Two-year Net Impact to General Revenue Related Funds for HB4063, As Introduced: a negative impact of ($2,698,000) through the biennium ending August 31, 2011.



Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2010 ($203,000)
2011 ($2,495,000)
2012 ($6,082,000)
2013 ($10,578,000)
2014 ($15,957,000)




Fiscal Year Probable Revenue (Loss) from
Foundation School Fund
193 		Probable Revenue (Loss) from
Economic Stabilization Fund
599
2010 ($203,000) ($608,000)
2011 ($2,495,000) ($7,486,000)
2012 ($6,082,000) ($18,245,000)
2013 ($10,578,000) ($31,734,000)
2014 ($15,957,000) ($47,871,000)

Fiscal Analysis

This bill would amend Section 202.056 of the Tax Code, relating to the two-year inactive well exemption from oil and natural gas severance taxes.

The bill would extend the two-year inactive well exemption program for an additional ten years by moving the application and certification deadlines to August 31, 2019 and February 28, 2020, respectively.

This bill would take effect immediately upon enactment, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect on September 1, 2009, after the last day of the legislative session.


Methodology

The fiscal analysis was based on information extracted from the Comptroller's oil and natural gas tax data and the 2010-11 Biennial Revenue Estimate.  The fiscal impact reflects the growing loss of tax revenues to the state as qualified inactive oil and natural gas wells continue to populate for the next ten years beginning March 2010.

Local Government Impact

No fiscal implication to units of local government is anticipated.


Source Agencies:
304 Comptroller of Public Accounts, 455 Railroad Commission
LBB Staff:
JOB, MN, SD, KK